QueBIT Blog: Three Ways to Justify an Investment in Budgeting & Planning Software

Posted by: Robin Stevens

Apr 6, 2016 8:30:00 AM

According to an April 2015 survey, fewer than half of finance leaders are satisfied with their organization’s budgeting methods. This will come as no surprise to anyone who has been involved in the lengthy, sometimes mind-numbing process of assembling and re-keying data in order to create a budget document that may simply be set aside as soon as it’s complete. Some organizations require as much as eight months to complete the budgeting process, at which point all of the painstakingly collected data is eight months obsolete.

Although the technology exists to streamline budgeting and forecasting, many companies are slow to adopt, for many reasons. Users are comfortable inside Excel. Streamlining data into a budgeting and planning (B&P) system like Cognos TM1 takes time that many organizations feel they don’t have. A poorly executed consolidation can lead to more problems than it solves.

As a result, many organizations continue to operate exclusively inside Excel, justifying the practice by the fact that they are not alone in this practice. If your organization is among them, you may be eager to end the headache of the annual budgeting process, but have a hard time justifying the time and investment required to streamline the process. We’re here to help, with three reasons your organization’s finance data belongs in Cognos TM1.

One: The Cost of Re-keying is Higher Than You Think

One organization surveyed by CFO Magazine admitted to dedicating a Harvard MBA full-time to the process of consolidating data from disparate Excel sheets. Even if you haven’t fallen prey to such a tremendous waste of education and skill, it’s likely that your organization spends inordinate amounts of time every year gathering and re-keying data. If you calculate the hours spent by individuals in every department each year, you’ll have powerful support for your argument to streamline the process.

In addition to the hard cost, there is also the risk associated with human error. If there is one thing to be learned from the frequent news of high-profile CFOs fired over forecasting errors, it’s that mistakes are expensive. Re-keying introduces substantial opportunity for human error to muck up budgeting and forecasting data, which can be catastrophic.

Two: More Time for Analysis Translates to a Competitive Edge

Once you’ve freed your best employees from the mind-numbing task of manipulating and consolidating data, that brain power can go to work analyzing your business in order to make smarter, more agile decisions. With data feeding directly into Cognos TM1, budgets can be prepared quickly and efficiently, leaving time for assessing the market, building what-if scenarios, and responding to changing market conditions. Instead of paying them to type numbers into spreadsheets, let them earn their keep providing the organization with a competitive advantage.

Three: You Get to Own the Data

With all your data in Cognos TM1, company managers can easily roll up accounts into defined P&L categories, placing the data at the CFO’s fingertips. CFOs can now hold line managers accountable to the data, ensuring greater accuracy and faster resolution when mistakes are made.

“The Cognos tool is much more finance-owned,” notes Greg Bozigian, director of financial planning at Princess Cruises. “We don’t have to involve IT on a daily or weekly basis.”

It’s true that Cognos TM1 implementation comes with a price tag, both in time and cost. When done incorrectly, it can cause bad numbers to propagate throughout the organization and create more confusion and problems than it solves. It’s important to involve data integration experts and experienced Cognos TM1 consultants in the process to keep it on track and ensure the benefits are realized.

When done correctly, organizations can expect to cut long-term costs and improve competitive position, while simultaneously reducing risk exposure. American Dental Partners, one of the nation's leading business partners to dental group practices, engaged QueBIT to help them integrate their data and create a streamlined budgeting and forecasting system in Cognos TM1. You can read how it turned out for them here.

If you’d like more help justifying the Cognos TM1 investment to your organization, feel free to contact our team today to answer questions and help you build your case.


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